5.625% mtg approved - locked & loaded! Did the final leg of paperwork today, have been approved for a 5% down loan at 5.625% fixed 30 years. Am now working on getting a 2nd 15% to eliminate PMI ($200 monthly). The deal is something I can live with today and can only get better. The 2nd will be at a higher rate, possibly a HELOC at prime +1.5% or fixed at 7.75% The loan officer said he was impressed with how "in order" my paperwork and CR was. There was one lien not marked as released on EQ, had a release from IRS. My balances on CC were all close to zero, so my only debt is my car loan at $250. All ratios are great, I could have borrowed 25% more and I'm well within my means here. Much of this is due to what I've absorbed here on CN and a few other boards. Thanks to everyone, I'm about five weeks from closing on my own place.
5.625% mtg approved - locked & loaded! Congratulations. Just a caution ... do not take HELOC for the second 15%. Think about it ... it is a "REVOLVING" credit line, and will be reported as such, no matter it is real-estate related. For FICO, it looks like a giant credit card, with 100% usage ... just think what it would do to your scores .... Even if the interest rate is higher, go with HEL
5.625% mtg approved - locked & load I'm aware of the utilization issue, which would be hilarious considering I spent the last year paying down my CC to get to 2% utilization! If it comes down to PMI vs. HELOC, I'll probably still opt for HELOC. At this point, I can afford the 100 point hit on my FICO, I've hit my goals for now. I'm not touching prime cards for a few years because of my BK, so I can live very nicely w/what I've done so far. OTH, several hundred dollars monthly of non-tax deductible PMI will be painful for at least two years, maybe longer. If I can get the fixed 2nd, obviously, I will.
5.625% mtg approved - locked & load Nice Job Dan. I remember the feeling last year when I was finally approved for a mortgage after picking my scores up from the mid 500's. Congrats!!!!!!
Re: 5.625% mtg approved - locked & load who gives a crap about a score when you are saving yourself money? i would much rather get a 1.5% over prime heloc compared to a term at 8.5%. scores are only important when you have bad credit. you even said it yourself that your not applying for more credit, so do what helps your BUDGET the most. btw, if i didnt say it - good job on the mortgage. that is when you know you truly made it
Re: 5.625% mtg approved - locked & load 5.625 fixed 30 years with 5% down 2.5 years out of a BK? That is a great deal and CONGRATS on it. You have a really tough decision PMI vs FICO. I guess I would go for the HELOC if I were you. Tough decision though. Please take the HELOC so I can pass your scores j/k. NICE!!!!!
Re: 5.625% mtg approved - locked & load For those who are wondering about mortgages w/BK, I've been told there are a few things they're looking for. 1) Two years since DISCHARGE. My filing date was 8/01 but my discharge was 2/02 - I'm right "on time" (note that every lender has their own guidelines. I was told it used to be three years but some companies have "relaxed" it to two, and others have five years. You can't set your watch by this, but then there are other sub-prime companies that will do it one year or less) 2) History since the BK. In my case, I acquired a Cap1 card and financed a 2000 Honda last April. I also had very low utilization and unusually high scores for a recent BK. 3) This can vary, but a "good" reason for the BK. I wrote up a letter about my being self-employed, having a client who went BK and stuck me for a year's worth of income, etc. IOW, they don't want to hear "I left my wife for a girl named Candy and spent $100k on Amex for lap dances." The other thing to keep in mind is that your BK is a large roadblock and even just a few other "speedbumps" could get you refused. In my case, my debt ratio, income, work history, savings, etc. were all green lights.
Re: 5.625% mtg approved - locked & load congrats on the mortgage! waiting for that final commitment letter was the most stressful part for me! i think since i was coming off of having bad credit for a long while, i was extra careful to make sure my paperwork was in order. everyone at the mortgage company was saying how they wish all their clients were as thorough as me! great rate too, i stupidly locked in oct/nov timeframe (just after they started dropping after the summer's run-up) and got 6.25%. we'll see how rates move. if it drops another quarter point, it'll be worth it to refinance already (just closed last week)! i went heloc for the second mortgage as well. after running the numbers, it just makes so much more sense than PMI. and maybe someone can clear this up for me. since the minimum monthly payment is the interest only, as I pay down the balance, it should drop the minimum monthly payment also right?
Re: Re: 5.625% mtg approved - locked & load you are correct. the interest on HELOC's is based on the amount utilized at that time. as you pay down the balance the minimum payment will drop as well. i would suggest continuing the higher payments (if you can afford to) so that it gets paid down sooner.
Re: Re: 5.625% mtg approved - locked & load thanks. in fact, i was planning on doing a partial balance transfer to a credit card that's offering 0% for 1 year. that will instantly decrease the total monthly payment, which was already $150 less than PMI and tax deductible to boot.
